Brexit win for finance firms as UK plans major strip of EU regulation to be ‘best in world
Boris Johnson discusses plans under Brexit Freedoms Bill
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The plans aim to make the UK “the best regulated advanced economy in the world” according to the Government’s new Benefits of Brexit paper released this week. Among the plans is a review of retained EU legislation which will be bolstered by proposals to simplify the speed with which this can be amended or removed entirely. After Brexit many EU rules were onboarded into the UK system with businesses now hoping for opportunities to improve these. Emma Reynolds, Managing Director of Public Affairs, Policy and Research at lobby group TheCityUK, said: “The Government has shown a welcome commitment to boosting the UK’s international competitiveness in financial services and related professional services.
“World-leading regulation must be an integral part of achieving that ambition.
“Now that the UK can shape its own regulatory framework, it should be able to take a more agile approach to regulatory reform, building on the UK’s global reputation for high standards.”
Victoria Hewson, Head of Regulatory Affairs at think tank the Institute for Economic Affairs, told Express.co.uk the objectives were “necessary” and she welcomed them, but added this would be a “vast task.”
She explained currently EU laws had been left with a privileged position so could only be removed by acts of Parliament, slowing any removal or modification.
Under the Government’s proposals more power would be given to ministers to do this with the document arguing: “We cannot delay much needed regulatory change, or risk baking in outdated EU law.”
However, Ms Hewson warned that the ambitions would need to be backed up with action from regulators.
In a recent blog post she warned the Financial Conduct Authority had gone “woke” by proposing the addition of diversity targets to company listing rules.
She explained: “When you look at what regulators are doing some are pushing an activist political agenda.”
This, she said, contrasted with the aims of the Government’s Brexit document of “regulation only where absolutely necessary.”
In the wake of the document’s release the Government has been consulting with tech firms who were invited to Downing Street yesterday for talks on making the UK more attractive for companies to launch.
One attendee, Romi Savova, CEO of PensionBee, told Express.co.uk the Government “believes tech will be key to solving the productivity crisis” and was very motivated to help tech thrive.
Ms Savova suggested a key area of focus should be looking at how research rules could be improved.
One area is MiFID 2, an EU legislative framework also carried over, which has been accused of hampering investment research by adding additional costs.
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Ms Savova explained: “You can have wonderful British companies, you can have companies doing amazing things, and no one will hear about it because there simply isn’t enough research.”
Last year the FCA began diverging from the EU by exempting companies with a market cap of less than £200m from the research payments rules however there have been suggestions this should be raised.
Another key area is promoting more retail investors which is currently a major strength of US markets.
Ms Savova said there were “definitely reforms that can be made to stimulate that” such as giving all new share offerings a mandatory individual investor component.
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